From practically bottom of the league Dublin has moved up in the rankings to 20th place in 2013 from 26th place out of the 27 cities in last year's survey. For new investments, Dublin has moved up to 15th place from 22nd place last year and for development prospects, Dublin has moved up five places to 19th.

Conducted in conjunction with the Urban Land Institute, the survey of Emerging Trends in Real Estate Europe 2013 notes, that the improvement is partly attributed to improvements in the Irish economy and the clarification of upward-only rent reviews which has also helped to calm the concerns of investors who stayed out of the 2011 market.

Guy Hollis, managing director, CBRE in Ireland, attributes Ireland's improved ranking to a notable increase in the volume of investment transaction activity over the last 12 months as banks, receivers and NAMA continue to release assets to the market for sale.

"We believe that prime property in the Irish market is now moving into a recovery phase. However, secondary assets will take considerably longer to unwind," he adds.

Mark FitzGerald, executive chairman of Sherry FitzGerald, said Dublin's strength as a capital city is helping it to begin to recover. "Research data shows that there were approximately €3 billion of residential and commercial transactions in Dublin in 2012," he added.

Mr FitzGerald went on to say that regional Ireland accounted for approximately another €3 billion of residential and commercial transactions, which may come as a surprise to many people. "Dublin is seeing 51pc of the transactions, and the rest of the country 49pc.

In terms of investment transactions Dublin was ranked 20th in 2012.

The report notes that investment market remains extremely thin in Dublin, though this could improve substantially over the coming months. Interviewees predict increased opportunities to invest in distress properties, as Irish banks begin to release properties to market and the appetite appears to be there especially from the US opportunity funds.

Speaking at the Irish launch of the report, Enda Faughnan, PwC Ireland Real Estate Partner, said: "The survey results indicate improvement in Dublin real estate prospects across the board as prices are seen to be bottoming out. We are certainly seeing increased interest from international investors and, together with renewed activity from local high net worth individuals, this will result in a stronger transaction flow this year."